Global fertilizer demand
Given the weakness in crop prices, it is not surprising to expect a similar trend for fertilizer prices (MOO). The IFA (International Fertilizer Association) forecasts a 1% decline in global agricultural fertilizer demand in the 2015–2016 growing season YoY (year-over-year) to 181 million metric tons.
Let’s look at individual breakdown of demand by NPK [1. Nitrogen, Phosphorous, and Potassium] fertilizers.
Global NPK demand
For the 2015–2016 growing season, global demand for all three NPK fertilizers should decline. The demand for nitrogen fertilizers such as urea, ammonia, and UAN (urea ammonium nitrate) are expected to decline by 1% to 108 million metric tons from the 2014–2015 growing season.
Similarly, the demand for phosphorous fertilizer is also expected to decline by 1% year-over-year to 41 million metric tons. The demand for potash fertilizers is expected to decline by 0.8% to 32 million metric tons in the 2015–2016 growing season.
According to the IFA, a year-over-year anticipated decline in fertilizer demand will be driven by a sharp fall in Latin America, resulting from “unfavourable economic, political, and weather conditions” in Argentina and Brazil. In Africa, demand was hit as a result of El Niño.
Fertilizer demand forecast for 2017
The IFA (International Fertilizer Association) forecasts fertilizer demand to improve in 2017 by 2.9% to a total global demand of 186 million metric tons. Of this, the demand for nitrogen fertilizer is expected to grow by 3% to 111 million metric tons YoY. The demand for phosphorous fertilizer is expected to grow by 3% to 42 million metric tons, and the demand for potassium fertilizer is expected to grow by 2.3% to 33 million metric tons.
Several major fertilizer companies are scheduled to release their earnings within the next few weeks:
- Intrepid Potash (IPI): July 26
- Mosaic (MOS): August 2
- CF Industries (CF): August 3
- Agrium (AGU): August 3
Market Realist will provide updates on these companies as they happen.